The Wolf Of All Streets - What Will Happen To Ethereum After The Merge? David Duong From Coinbase Explains Possible Scenarios

Episode Date: August 19, 2022

Will Ethereum become a deflationary asset? Should we expect Ethereum's price to increase in 3 months? How does the merge define the future of Web3? This and more questions about the possible outcomes of the upcoming Ethereum merge, in my latest episode with David Duong, CFA, Head of Institutional Research at Coinbase! JOIN THE FREE WOLF DEN NEWSLETTER https://www.getrevue.co/profile/TheWolfDen Follow Scott Melker: Twitter: https://twitter.com/scottmelker Facebook: https://www.facebook.com/wolfofallstreets Web: https://www.thewolfofallstreets.io Spotify: https://spoti.fi/30N5FDe Apple podcast: https://apple.co/3FASB2c

One of the biggest narratives in the crypto market, one of the only bullish narratives one could argue over the past few months, obviously, is the upcoming Ethereum merge scheduled now for September 15th to 16th. There's a lot of interpretation as to whether this is going to be a bullish event or a bearish event, whether it will actually work or there will be a fork that would be forked up, as we like to joke here, of course. And what's going to happen in general? There's so many possibilities. But luckily, I have a guest who understands this a lot better than me, David, from Coinbase, who is the head of institutional research there. You guys have seen him here now quite a few times. He's becoming a regular guest and one of your guys' favorites.

We're going to talk the merge, markets, and more. That was alliterative. You guys don't want to miss this. Let's go. What is up, everybody? I'm Scott Melker, also known as the Wolf of All Streets. So guys, yeah, as I alluded to earlier, the merge obviously is a huge narrative right now. We're seeing this sort of market-wide correction right now. Hard to tell, I would say, at this moment for those of you who are actively or aggressively trading it, whether this is the dip worth buying, whether this is the bottom, or whether we're really seeing things roll over again. It's quite a big candle and quite a big

correction here. Ethereum obviously was trading over $2,000 just a few days ago now, all the way back to $1,700. Ironically, we kind of went over an Ethereum chart, I think, two days ago here on Wednesday, and I showed you that. Actually, when I took a look at the chart that I thought it was going to drop down to the mid-1600s, which is kind of almost what happened here. So now I can gather my clout for the one time I'm right out of 99.7 attempts at charting something accurately. But nobody really cares about what's happening in the extreme short term, right? We're all trying to zoom out and have a longer term, low time preference and long time horizon. So the merge obviously being now a month away, it's starting to become the singular, I think, narrative sort of for the crypto market at this moment, at least the one

that anyone not named Toxic Maxi is looking at. So as I said before, I've got David here from Coinbase to discuss this because he's had some amazing thoughts on the market. Dave, how are you, man? I'm very good, Scott. Thanks for having me here. Of course. So, Dave, notably, you had actually two LinkedIn posts that I read. And I have to tell you, I was so compelled by your post that I actually went to LinkedIn for the first time, I think, in like seven years. Mike sent them to me and I went on to LinkedIn. I had to sign into my profile. I had 900 missed messages. But basically, talking about all the seemingly now endless possibilities or combinations of what could happen with the merge. You have successful merge with macro being good or unsuccessful with bad macro and everything in between.

What are you thinking in general? And then we can dig in. Yeah. So I would say the bull case and the bear case are starting to become more clear to people at this point. And the bull case has kind of been apparent for a while. And we recognize what that is. The reduction of issuance, for example, by around 90% because you're no longer paying miners, for example, only going to the validators, plus the fact that you're including burning, staking. So the active circulating supply should actually potentially make this a deflationary asset. We recognize that there's potential value to that, as well as the fact that about 4000 developers a month are actually working on this thing. Like 20 percent of all the Web3 developers active out there are working on Ethereum.

So we know that there is potential here for revenues to go up, more activity to kind of be built. And we haven't even seen yet a lot of institutional investors really kind of coming to play, like the Coinbase partnership with BlackRock, for example, really only includes Bitcoin as a start. But once they start including ETH, for example, that may actually push the bull case up for there. But there's a bear case as well. And you kind of mentioned one of them, which is, well, how much of this has already been priced in? Because we've known about this for six years. Now, obviously, there's been a lot of price movement

just over the last six weeks to two months alone. And that has made things a little bit unstable. And we're seeing things kind of be reflected in the options market, as well as the futures market as well. But there's also the broader concern of, well, if you actually engage in this and you turn the consensus mechanism to proof of stake, it does make Ethereum look a lot more like it's alt one L1 competitors. And if that's the case, there's still a lot of development that needs to be done on Ethereum.

That's both a good and a bad thing. You know, we heard Vitalik Buterin actually suggest that it's only about 40% done right now. It'll be about 55% done after the merge. Well, that means that that roadmap with the merge, surge, splurge, like verge, all that stuff, like still needs to get done to make this complete. And we won't see the monetary policy, perhaps, or at least the policy of the network itself ossify until later. And we don't know when that's going to be. Yeah, that's exactly what I was sort of thinking here. The bull case, as you presented, is less about the merge in a month, but about what happens

afterwards, which could be months or years to play out. It actually kind of reminds me of talking about Bitcoin halvings in the past, where everybody freaks out that the halving is coming as if it's like a Y2K moment or something, and something's going to happen at that day. And then six months later, you start to see the actual impact of that supply decrease. And that's how I'm sort of viewing the merge here. And like you said, I mean, people forget Ethereum went from $880 to $2,000 already. And that was largely because of the merge, right?

I mean, it's outperformed because of this narrative. So maybe we do have a, at least shorter term, sell the news event. Right. And certainly there's the idea that in three to six months time, well, possibly this could start to look a lot more like a, you know, early growth stage kind of asset because of the potential inflows that can come in on the back of this. And like I said, you know, there's a lot of development and activity happening on here if you want to capture that. Well, we're still talking about an asset that's only at $225 billion in terms of its market cap, whereas there are trillions of dollars worth of institutional money that's kind of waiting to invest in something. And this could be a potential opportunity.

But we got to kind of compare that to the alternatives because investing is never just an absolute game. It's always about what's the next best alternative. Yeah, I think one of the, I guess, big questions I have for you, obviously, we're projecting maybe a 7% annual yield coming for stakers. Do you think that those institutions, since you're obviously doing institutional research, do you think that they will start to view Ethereum more as a viable yield bearing asset? I mean, yield has become a four letter word in the crypto space, obviously. But do you think that they'll see that, you know, looking at it like a dividend stock or something else like that? This will make it more of something they fundamentally understand? I think so. And we have to keep in mind, too, that that's 7%. So we did our study on the basis of projecting out how much will actually be staked, as well as how much actual active activity we're seeing, which is really kind of only raising somewhere around like $1,000 a day in terms of transaction fees. But there's also going to be MEV on top of that.

And the FlashBot guys have actually suggested that could increase the yield by another 60%. So we could be talking somewhere in the order of 10% to 11%. But I don't have firm estimates in terms of the MEV value that's going to be there. But, I mean, potentially, institutional investors, you know, I don't have firm estimates in terms of the MEV value that's going to be there. But, I mean, potentially they're going to, institutional investors, that is, will need to weigh what the illiquidity issues are relative to the yield benefits. I mean, you can't get out of that. That's part of one of the silly narratives that we have is that the minute that the merge happens, like people are going to unstake and sell, but it takes time to unstake.

It's not something you can do instantaneously. It wouldn't be a glut of supply on the market at one time i don't think people understand that but yeah that's a good point for an institution to say hey i'm going to park this for three or six months and not be able to get liquid could be really risky right and that makes it difficult to actually go all in on staking you know yeah like they have to weigh the benefits of like how much is that yield or potential yield value in value to me relative to just being able to kind of come in and out of this as I please. Yeah. And obviously it kind of brings us to the next question, which is the seemingly increasing potential here of a legitimate fork of legitimate and might not be the word for

it, but obviously one of your LinkedIn posts was sort of, you know, forked up, I think was the name of it or something like that. And I mean, this could get really ugly. This could actually get really ugly, right? Because there's so many things that can't exist really on both chains. So people are going to have to choose sides, oracles, you know, NFT, everything.'s right that's right and we've seen that some issuers of stable coins have already come out publicly about that chain link which is a very notable uh oracle network actually has already commented that they will not support a forked proof of stake network i'm sorry for proof of work network um and you know that could be problematic for economic activity on a potential forked network

because that forked chain cannot do smart contracts or won't get pricing data from Chainlink, which represents about 50% of the total value secured across the ecosystem. That is a very big deal. Or if people aren't able to redeem stable coins or wrapped assets, for example. So what we've seen in the past is that some of the fork chains like, you know, Bitcoin Cash or Ethereum Classic actually decreased in value almost a month after those tokens were launched. So this is something that is definitely on people's minds. I'll never forget that there was that one weekend not so long after Bitcoin Cash forked that it was

like the craziest asset in history to trade for 72 hours. And I think that we may see a lot of crazy speculative activity on the fork because it'll probably be somewhat low liquid and people have a lot of free coins. That's right. And this is why you look on the futures curve right now, it shows you that up to September contract through December, we're actually in backwardation on the futures curve because people are actually taking the long ETH spot position and selling the futures product, the December contract,

because they believe that if they can hold on to that long ETH spot, then they're going to get airdropped this proof of work token and they're going to be able to redeem that and just kind of cash it in for the money. But they want to keep themselves in a riskless structure by doing that. But the issue with that is if after the merge,

things are successful and potentially the value of ETH does go up, then they may need to actually buy those backward-aided futures. And actually, if that happens, the curve will re-steepen. Yeah. Now you get a massive short squeeze, basically, at that point. Exactly. But for now, assuming that nothing goes crazy, it's kind of free money on that trade for them.

Exactly. For right now- Yield. It's a yield. Yeah. It's a good deal for them. Exactly. Yeah.

So, I mean, if you're an average person, this is one of those, another one of those moments where I think crypto becomes way too complicated for the average person, this is one of those, another one of those moments where I think crypto becomes way too complicated for the average person. Like I've already had people asking me like, what do I do with my ETH? Do I need to send it somewhere to convert it? You know, you talk about all these wrapped assets and NFTs and all these things. Is there anything that your average person needs to be aware of that they might have to do in advance of this? Or do we sort of sit back and watch this, wait till the smell clears? Yeah, I had a good friend just recently asked me about that. And he's been in the space for a while.

And I was kind of shocked because I would have expected him to know this already. But I think the nomenclature has kind of bothered people because we've had ETH and ETH2. And the reality is there is no such thing as an ETH2 token. Everything should be seamless from the perspective of the user.

So it's almost like having your software upgraded on your machine. You know things are going on in the background, but you don't really have to pay attention to it because you're just a user and you're going to use your application. It's going to be just like normal. So the network isn't going to have any outages or stoppages. It's just going to theoretically go as normal. Now, what's going on in the background is going to obviously be very complicated. And it's a two-part upgrade. It's going to require both September 6th and September 14th or 15th

to actually go exactly as planned. So, I mean, there's a lot to it from that end. But from the user standpoint, you don't have to do anything. Do nothing. All just seamless. I want to touch on something that you said earlier, that basically as Ethereum makes the move to proof of stake, it sort of becomes a more viable competitor or the others become more viable competitors to Ethereum. The Solanas, AVAXs, the other layer ones, which is interesting because I think there's a misconception that gas fees are instantly going to go down or that the network is going to be much faster, but it seems that none of that's actually true, right? I mean, gas fees are

still going to be based on demand, so they can still be outrageously high. And there's not an expectation that the network's going to be that much faster. So they've basically put themselves in competition with all these layer ones that have at least, they can't solve the trilemma, but have tried to solve for at least cheap transactions or faster. Now we're going to be a proof of stake chain with neither. Yeah. And this is where I kind of need to switch my like former finance cap with like my current crypto hat, because I, you know,

talking to a lot of friends in the TradFi space, they understand things from the metrics perspective. And so it's very easy to understand that if you say throughput is going to increase or fees are going to increase or are going to decrease, but you know, for, as you just said, those things aren't necessarily going to happen. Are you going to move from like 13.4 seconds to, you know, 12.2 seconds of block. So there is like a 10% speed boost, but it's not going to be a game changer, for example. So it's harder to explain to them what the larger implications of this are, which is really you're talking about the future growth of the network, because this has never been done before. I mean,

there's also just the mere fact that carrying this out, I mean, it's obviously been a years long task, but it has been a major effort in global coordination. And putting a value on that is a lot harder than just kind of saying, well, you know, it goes faster, things go fast, price goes up, you know, like, yeah, you know, like, obviously, that would be the easy choice, but it's not this is about trying to anticipate what is going to happen in the future of not just Ethereum, but for the entire Web3 complex? Like that is the value unlock that's kind of being seen right now. The other thing, too, is I think there's this kind of obviously like misconception surrounding like, oh, well, like once we do this, I'm also going to be allowed to, you know, unlock my my tokens all this kind of stuff no no no like the the the

upgrade path here still needs to actually see the shanghai fork to happen and then there's going to be minor upgrades like after that um so there's going to be a lot that still needs to be done after this is all said and over with with the merge yeah so i think it leaves more questions and answers as sort of time goes on. And the more you kind of talk about it, and the more I talk to my other guests about it, it seems like we've had the hype move from it. Now we need to wait and see what's going to happen long term. I mean, in a perfect world, if Ethereum becomes an deflationary yield bearing asset, it's hard to imagine that wouldn't be extremely bullish, but a lot of things have to happen. That's going

to take quite a long time. Absolutely. And, you know, actually, I didn't, there's a point that you kind of mentioned in your last question, too, that I didn't really quite get to, which is the fact that people are now then saying, well, how do I compare this relative to the other all-tell ones? Doesn't it make it look more like that? And so, therefore, there isn't as great a value because it has more competition from that angle. And you have to keep in mind that, you know, the roadmap that Ethereum chose, particularly using L2s as a scaling solution, for example, this was all the design choice. This was a way to actually try to resolve the scalability trilemma in order to maintain security, but also get those speed

upgrades and other things that is required in order to kind of become the Web3 transaction layer in the future. Now, that said, like some of these alternative layer ones have been able to improve speeds or throughput or reduce costs, but they haven't done it necessarily in a way that has been able to resolve that trilemma. And there, some are more centralized than others. Some perhaps have- Go down once a month, right? What's that?

Some are offline once a month. Exactly. So you kind of keep that in mind. Like, yes, there is competition, but what is the value or state of that competition? I think that is going to Like, yes, there is competition, but what is the value or state of that competition? I think that is going to be, again, like I said, it all depends on what your alternatives are. Look at what those alternatives are before you really try to see what the investment landscape looks like. Before I let you go, I have to, although we don't try to comment

too much on markets, I know, what do you make of this sort of aggressive sell-off that we've seen over the last day across the market, not Ethereum specific? I think it has to do with macro as well. And I think that's what we got to keep in mind. Like a lot of our investment thesis is still kind of contingent on what we're getting in terms of trying to play the Fed pivot. So, you know, I spend actually about a good 30% of my time right now just trying to pay attention to understand what's going on with inflation, because the more it looks like it has peaked, obviously, the better the investment thesis. pace starting in September. The cost in terms of what the income that the Fed actually receives from that balance sheet is going to become negative in the months to come. The USTGA balance is actually going to start to rise. I mean, all of that kind of unfortunately kind of argues for a more negative medium term outlook as far as risk assets are concerned, not just crypto,

but kind of all risk assets. So I think after the large run up we've kind of seen this summer, which arguably has been happening under some lower liquidity conditions, I think that it's still valuable to kind of have a little bit of caution as we get into Q3. Yeah, I think that that's probably an accurate approach. I would hate to see that this is sort of the moment when the market is rolled over again for a while. But those are the sort of daily candles on volume that we see when things are about to just kind of either, you know, the bullish case sort of ends for a little while or we

do see a retest. I mean, I don't think anyone would be surprised to see things at least go make a higher low or try to return to the lows. Right. We have not really had any confirmation that we should expect to be in a completely fresh new bull market all of a sudden. Absolutely. And I mean, we have to keep in mind that we just kind of came off of a, you know,

pretty negative run in the first part of this year, but it hasn't been over yet. We still haven't, like the Fed's mission isn't accomplished. Yeah, they're going to, I think that in fact, yeah, I think they're more empowered right now, honestly, to tighten aggressively because things aren't that bad, right? I mean, like jobs and they think that right now they can get away with it. It's going to be a rough run for markets. Well, thank you as usual for all of your perspective. I think, you know, the merge at this point

is like proceed with caution and just wait and see what happens for me. You know, and I know everybody's going to have a different opinion, but listening to you, that's sort of the approach I think I'm going to take. Oh, absolutely. And you need to kind of pay attention to what the participation rate is going to look like.

You know, like Gorley, for example, was considered a success, but still we saw that participation rate drop from 90% to 67%, which was enough to actually make the, you know, to reach finality. But still there are going to be those kinds of things, which maybe your layman isn't necessarily going to focus on, but I think for the broader community, that's something that we want to keep in mind. Perfect. Thank you so much, everybody. Check out David. Of course,

your Twitter's hilarious. I have to say it. DD, that's three D's. So I mean, whenever I touch it, I'm like, David, no. It's not the easiest to tell people over the phone. They're like, no, it's great. DD, that's three D's. Well, thank you once again. And I guess we'll have to come back. Maybe we'll have a merge party in a month or something and we can watch it in real time if it actually happens. Absolutely.

Thanks, Ed. Speak to you soon. Thanks, guys. So, yeah, I think the more increasingly I talk to people, yesterday, obviously, I talked to Raul Paul, Scaramucci, Mark Yusko, and everyone's sort of opinion seems to be, we had a really nice run up because of the merge. And now it's time to sit and wait. I certainly would not expect that the merge happens and like Ethereum doubles in a week or something. That's not what I'm looking for, which means it's probably honestly what will happen.

Because we're always wrong, obviously. Oh, Kev, man, is anyone else blocked? Do I have you blocked on Twitter, Kev? I love you, man. You never know who gets blocked. I have no idea what you might have said. But you go ahead in the comments and put your Twitter name and I'll unblock you. And then I'm going to block you again just to mess with you. But why not? So guys, let's dig into the news here. Obviously, we have quite a bit going on in the market. Over 540 million liquidated as Bitcoin, Ethereum plummet. Question is, is that the story here? Is that the story? Is the whole story, once again, that people got over leveraged, they got a bit exuberant and open interest piled

up and longs were heavily paying funding? Maybe that's all that this is. And we just saw a washout. For now, I mean, when you take a look at the chart, we still sort of have higher lows. But I never love to see these huge candles like we saw. I mean, I woke up this morning and kind of gave a WTF look at the chart when I first took a look. Because when I went to bed, things were kind of still chopping sideways in the 23s or wherever we were at. Actually, let's take a look at the Bitcoin chart. I only have one pulled up right here. But I mean, you can see there's a weekly, there's a meaningful candle, right? Because we were, for people who like to trade moving averages for mean reversion, obviously, it was very encouraging

that Bitcoin was trading so squarely above the 200 MA for going on four weeks, right now i mean it just nuked nuked it like it's absolutely nothing i mean take a look at the daily it also nuked through the 50 ma on the daily i don't think that support is particularly meaningful it's an old chart uh nuked right through the 50 ma on the daily on really increasing volume i, who knows where this day will end, but it's likely it's already the highest volume day that we've had in August. When price action is confirmed by volume, you pay attention, right? We've had low volume, obviously, but when you see an increase in prices going down, that's confirmation of that downward trend. But you want to see that happen for a few days to really understand that better, of course. But this is a pretty bad candle, right? And now, quietly, one, two, three, four, five.

This is the sixth red candle in a row, and these are very toppy. I mean, I haven't been paying much attention to charts, but like, in hindsight, it's 2020, so whatever. I'm not trying to say like anyone called it or anything. You know, but that's a topping candle. Those are three topping candles with those long wicks up all kind of shooting stars right there at the top you can see the same happened here we talked about it actually that when this candle happened but every one of these local tops has had these candles basically right and so listen we've had the these dumps the same

way so now kind of what you're looking at here, I would say that you could argue either, but probably we just don't want to see the market nuke below like this 20,700 because that's this series of low, high, higher low, high, high, right? We have all these higher lows and higher highs that have made this sort of local bull trend. That's still intact above 20,700. Some would argue maybe down here at 18,933, but I think that's being a little bit bolt-hearted. Oh, look, I'm Kusanoki. What'd you say to me? What did you say to me on Twitter that got you blocked? There was a while where I wasn't even looking at my Twitter and people were like, my team was blocking. Have you blocked? Look, you're unblocked. I literally just took my time out of this live stream to unblock you.

Don't be a dick. And you're blocked again. Just kidding. No, you're unblocked. I did it right there in real time. You can go look. Tell everybody what a kind-hearted soul I am. You probably deserved it, though.

I'm going to be honest. I'm assuming you did. But anyway, so that's what I'm looking at on. I mean, it's pretty, this is pretty uninspiring. It's going to be interesting to see where the day closes, right? We definitely want to see the week closing back above that 200 MA. Otherwise, that's a massive trap. And that becomes an ugly resistance. Once again, let's keep going. World's biggest companies invested $6 billion in blockchain firms September to June. Study. But I should have had David still talking about this. Google parent Alphabet participated in four funding rounds that raised a total of $1.5 billion blocked out of found. Basically, it's kind of a shady metric on the way that they've determined,

but this is based on how many funding rounds any company was involved in in crypto, led not surprisingly by Samsung, who had 13 companies they invested in. Google invested in four, but for $1.5 billion, quite a lot. Also, I mean, we're now talking about BlackRock and Morgan Stanley, and they count as companies that are investing in the space. And now beyond just doing these sort of VC investments that we're talking about here, they're also opening the doors with the Bitcoin Trust and other products for their high net worth individual clients. I mean, quietly, as all of this sort of pain has been happening, the biggest companies in the world have been sort of getting their feet wet in the crypto space.

And they don't do that without a hell of a lot of research and quite a bit of conviction. Now, these are small bets for companies of this size, of course, but we haven't really been having long conversations about Google or Alphabet and their investments, but it really is happening. I mean, $1.5 billion is a drop in the bucket for them, but it's meaningful for the crypto industry. So anyone who's making the argument that institutional involvement here is dead or non-existent, there's a lot of ways to sort of look at that. ago when MicroStrategy first bought Bitcoin, right? Because that was, I believe, August of 2020, really just two years ago, right? That sparked the entire sort of next bull run because then Square, Tesla, all of them bought Bitcoin.

And we had this sort of prevailing narrative that Bitcoin was going to be adopted by all these institutions, put on their balance sheets. Michael Saylor had 2,000 companies and talked to their CFOs and none of that happened. Right. And so a lot of people said the institutional narrative was dead because they weren't adding Bitcoin to the balance sheets. But what ended up happening was that all of these companies spent their money effectively through venture capital.

Right. I mean, we've seen Andreessen Horowitz raise billions, multiple billions in funds. People can leave Andreessen Horowitz and then they can raise a billion dollar fund. We saw another 300 million dollar coin fund. I mean, there's been absolutely no slowdown, if anything, a massive increase in the amount of money that's pouring into crypto from institutions. It's just happening more through VC than it is through simply buying Bitcoin. And probably actually for long-term growth of the industry, unless you just believe it's a Bitcoin-only world and that this is somehow evil, which I know some of you believe because I see you in the comments, that I think that it's not necessarily a bad thing. It's just not the approach that we thought

would happen. But here you go. World's biggest companies invested $6 billion. That is a lot of money. Crypto stocks slide in pre-market trading as Bitcoin slumps 21.5. No surprise here. We talked about this yesterday. Coinbase, to some degree, but certainly Marathon Digital, Riot Blockchain, all of these mining stocks are like a 5x leverage position on Bitcoin. Maybe we'll call it like a 3 to 4x leverage position if you're doing the math. But you don't really need to trade Bitcoin on a leveraged casino. You could just go ahead and trade these mining stocks or crypto-related stocks because they have that beta. They have that increased volatility over the actual underlying asset of Bitcoin. But yes,

when Bitcoin gets rocked, these get triple rocked. And when Bitcoin goes up, we've seen these massive bounces in the mining stock. So nothing really surprising here. But interesting to note that effectively, almost all of these stocks that have Bitcoin exposure, they just do what Bitcoin does, right? Very hard to see them sort of separate. Like you're not going to, nothing, I mean, nothing would surprise me, I guess. But for example, you're not going to see Marathon or Riot or even MicroStrategy at this point, which is not a Bitcoin company, right? Or Coinbase, you're not going to see any of them boom independently in a Bitcoin bear market. You're not going to see Bitcoin going down and Coinbase doubling in value, and you're not going to see it. That's nothing against any of these companies. It just means much like trading altcoins for the last five years, you always have to be watching

Bitcoin if you want to be watching. Listen, I know I had David on here. Nobody's been probably a more outspoken Coinbase stock buyer of the dips than myself. So I'm obviously willing that to be the case. I have a pretty massive position there and believe that Coinbase will be one of the most important five companies in the United States over the next five to 10 years. But right now, that's not going to happen until obviously we see a major market correction to the upside. Right. And finally, run to earn game Steppen teams with Atletico de Madrid and crypto exchange Whalefin for NFT sneaker collection.

Steppen just continues to like be in the news here. Every time I turn around, obviously, this is one of the few companies that we've seen. I reported it not that long ago. That actually is, you know, making money. Crazy, I know, I know. But they had, you know, they made over $100 million, I believe, last quarter. I still haven't actually used it. And I know that there's the sort of barriers to entry with having

to buy an expensive NFT, which I believe has come down. But now they're doing this NFT collection alongside Whalefin, 1,000 digital soccer cleats compatible for under earned and eligible for real world rewards i think you're gonna literally in web three be able to do anything to earn i think we've seen literally like i think there's a sex to earn project i can't i have to imagine that we're gonna have to like some sort of breathe to earn like you know you wear your apple watch and it takes your temperature and you temperature to earn right right? There was the one that comes around every six months that people share on my Facebook, like normie people, and think it's some brand new crazy thing, the poop to earn guy, you know, the guy with the toilet and they keep sharing the story as if it's brand new.

Well, you can do basically anything to earn. But this is all like speculative ideas. Some of it will pan out and some of it will not. But Stepin seems to be legit here. And I love to see any of these sort of big partnerships with major sports teams, things like that, because quietly those have kind of disappeared. Right. I actually saw an article like you'll notice that you don't see the Matt Damon and LeBron James commercials on TV anymore. They've been pulled. Right. They're not spending money on that. We're sort of, I don't think we're going to see probably,

maybe I'm wrong anymore, stadiums being named after crypto companies for the next few months. I think we sort of had that hype cycle. So anything where we're seeing these sort of moves of crypto towards more mainstream adoption, I think is really wonderful. I did want to take a look at the Ethereum chart,

just kind of laughing because the other day I was telling you there was this stupid meme head and shoulders and we were talking about it. I posted it on Twitter. Probably the first time I've posted a crypto short chart, I don't know, in three years. That's just not something that I encourage people to do. I didn't do it myself, but you can see that this did actually play out sort of how we were talking about. I guess we were right around 1837. I said it looked like

a short at 1851 with a stop somewhere above the 50MA, the 1900s. Well, that got exactly what we were looking for and moved down to that 200MA in the four hour in this sort of major area of demand. This would be, if this is just one of those uh leverage sort of washouts this is a very reasonable place to bounce but right now this candle is uh way too ugly and aggressive to the downside to to get i would say excited about doing anything bottom line ties yeah maybe i shared it and whatever i didn't trade it and i we just had a long-ass conversation about ethereum and how to approach it i just don't see a reason to be day trading these assets unless you're literally doing it for income and have been doing it for the last 20

years. This is just educational. It's fun to look at charts. Once again, astrology for men, this could have gone the opposite way. I had a 50-50 chance of being right. Congratulations, I did it. Nailed it. Nailed it. Absolutely nailed it. But yeah, guys, you know how it is. That's actually all I've got for you guys today. I'm coming over to see who else is angry that I blocked them. Nobody. Nobody. We only had the one, uh, the one blocky over here.

Uh, Scott, will you be on banter after? Not that I'm aware of. I think banter now is actually at the exact same time as us. Uh, which I think is about, they start at 9 15 AM Eastern time. Once again, guys, that's all I got for you. I will be back on Monday. Hopefully, we will have a good weekend. Be watching, I guess, if you are watching the charts.

Zoom out, look at the weekly, see if Bitcoin can close back above that 200 MA. Where was that? That was around 22,900 now. So we got some work to do. That's all I got for you guys today. Have a good one. Peace out. Let's go.